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Dublin: 18 °C Tuesday 25 June, 2019

Noonan insists: 'We would never hit depositors in Ireland'

Speaking in Brussels ahead of crunch talks on a proposed bailout for Cyprus, Finance Minister Noonan said he expected to reach a deal but that it will be a long night.

Michael Noonan arriving in Brussels this evening
Michael Noonan arriving in Brussels this evening
Image: Screengrab via TV Newsroom

FINANCE MINISTER MICHAEL Noonan has insisted there are “absolutely no circumstances” under which the Irish government would impose a levy on bank deposits in Ireland ahead of crucial talks on the Cyprus crisis.

Noonan was speaking to the media ahead of an extraordinary meeting of eurozone finance ministers in Brussels tonight where discussions will focus on whether Cyprus’ so-called ‘Plan B’ measures are sufficient for it to merit €10 billion in emergency EU/IMF funding.

He insisted that the current crisis in Cyprus “means very little for Ireland” and said that that the Cypriot government’s proposed levy on bank deposits was not something which would happen in Ireland.

“We would never hit depositors in Ireland,” he told reporters.

“We believe that the €100,000 is absolutely sacrosanct and there is absolutely no circumstances in which we would touch depositors because they’re being guaranteed and that guarantee applies across the eurozone.”

The Cypriot government is currently proposing a controversial bank levy of as much as 25 per cent on deposits over €100,000 in its main bank, the Bank of Cyprus, as part of a range of measures aimed at satisfying EU/IMF authorities in order for it to release emergency funding.

Noonan said that he expected discussions on Cyprus to last long into the night as “a lot of detail has to be worked out” but he said that he thinks a deal will be done tonight.

“My own view is that the position has deteriorated in the week because uncertainty always causes greater difficulties so it’s not going to be easy tonight,” he said.

Noonan also admitted that some of his colleagues had “doubts” about the original proposals from Cypriot authorities last week to impose a levy on all bank deposits.

This would would have seen a 6.75 per cent levy on accounts under €100,000 and 9.9 per cent levy on accounts over €100,000 in order to raise €5.8 billion.

Speaking about events last week, Noonan said: “There was a proposal made coming up to midnight which was unacceptable to the Cypriot authorities and the proposal that was agreed three hours later was one proposed by-and-large by the Cypriot authorities.

“So because it was their design people agreed with it. But quite a lot of people would have doubts obviously.”

The meeting of eurozone finance ministers has already been delayed until 7pm Irish Time as preliminary discussions between the Cypriot president and EU/IMF leaders continue.

More: Eurozone finance ministers to meet in Brussels on Cyprus crisis

Explainer: Your 25-point crash course to what’s happening in Cyprus

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About the author:

Hugh O'Connell

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